An infrastructure-oriented thinktank is raising serious concerns over the ‘railroading’ of a proposed congressional franchise being granted to Solar Para sa Bayan’s proposal for mini grid systems.
“We are alarmed at the speedy approval of this congressional franchise, as the concerns of many stakeholders have yet to be addressed conclusively by the House committee on legislative franchises,” said Terry Ridon, Convenor of Infrawatch PH and former urban poor chief of President Duterte.
Ridon, who was a former member of House committees on legislative franchise and energy, said that the proposal has “very special entitlements” which weren’t part of other power-related legislative franchises.
“The most questionable provision in the franchise proposal is the exemption of the minigrid franchise from the regulatory powers of the Energy Regulatory Commission (ERC).”
Ridon said that the mini grid proposal of Solar Para Sa Bayan should not receive any special treatment and should be no exception to the regulations and rate-setting of the ERC.
“At this time of almost seven-percent inflation, government should be able to retain control over electricity prices and services, including mini grid systems. The franchise draft provides no mechanism for dispute and settlement on rates and services, as apparently the ERC has no powers over the minigrid franchise.”
Ridon also said it was ‘very surprising’ that the franchise draft has removed a standard franchise provision requiring legislative franchise holders to seek congressional approval prior to the sale, transfer or assignment of controlling interest in any franchise.
The removal of a standard franchise provision in the franchise draft was also “very surprising.” The removed provision requires legislative franchise holders to secure congressional approval before the sale, transfer or assignment of controlling interest in any franchise.
“This standard provision is included in the grant of legislative franchises, in recognition of the status of franchises as public utilities serving the public interest. We have yet to understand the wisdom of our former colleagues as to why this was made for this particular franchise.”
The microgrid franchise also changed the standard equality clause in previous legislative franchises; the microgrid bill now needs congressional approval in order for previous franchise holders to possess the same entitlements as the proposed microgrid franchise.
Ridon said that they are alarmed that the concerns of power stakeholders were not fully given attention nor resolved by the House committee when it approved the microgrid project.
He suggested that the project should be returned to the House committee on legislative franchises in order to have more thorough discussions between affected stakeholders.
“It should be made clear that all efforts to reduce power costs and expand access should be welcomed by all. However, if this comes at the expense of making shortcuts in our democratic processes and providing very special entitlements to franchise holders, it would probably be better to take a step back and subject the proposal to further public scrutiny.”